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Study shows little link between sugar prices and jobs

Lula Sugar Mill, Belle Rose, La.

COEUR D’ALENE, IDAHO — There are weak or no relationships between low sugar prices and both U.S. manufacturing jobs and U.S. retail sugar prices, according to a study discussed at the American Sugar Alliance’s International Sweetener Symposium held in Coeur D’Alene on Aug. 2.

Alexander Triantis, dean, Robert H. Smith School of Business, University of Maryland-College Park, Md., said there was no evidence in data going back to 1990 that sugar prices affect job loss in the sugar-containing-product (S.C.P.) industry, and, in fact, there was no relationship between prices and S.C.P. jobs.

The S.C.P. industry was “faring very well under current U.S. sugar policy,” Mr. Triantis said, suggesting the S.C.P. industry was somewhat “recession proof” because consumers eat candy when times are good and when times are bad.

At the same time, a weaker U.S. sugar policy would have a “large impact on the 142,000 jobs supported by the sugar industry,” Mr. Triantis said.

Data going back 35 years also did not support claims that lower wholesale sugar prices would result in lower retail sugar prices or lower prices for sugar-containing foods, Mr. Triantis said. In fact, retail prices went up or stayed flat even when wholesale sugar prices declined.

Alexander Triantis, dean, Robert H. Smith School of Business, University of Maryland-College Park, Md.
Alexander Triantis, dean of the Robert H. Smith School of Business of the University of Maryland

“There is no evidence that lower sugar prices are passed on to consumers as lower retail S.C.P. prices,” Mr. Triantis said. Food manufacturers and candy makers were seeking lower-priced sugar to reduce their costs, he said.

The study, which reviewed data on world and domestic sugar prices, wholesale sugar prices, retail sugar prices, employment, revenue and other categories back to 1980 in some cases, was sponsored by the American Sugar Alliance, which represents U.S. sugar producers. It was done in part in response to food and candy manufacturers’ attempts to reform the U.S. sugar program and eliminate U.S. import quotas.

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